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tv   Washington Journal  CSPAN  July 12, 2011 7:00am-10:00am EDT

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the federal tax system. then, bill miller of the u.s. chamber of commerce on the debt, jobs, and the economy. george washington university law school professor michael abramowicz will discuss what the constitution says about u.s. debt obligations and however relates to the current debt talks in washington. that is later in the show. host: president obama and congressional leaders enter into another day of debt negotiations. after nearly two hours of meetings monday, a deal has yet to be reached. president obama yesterday rejected a short-term deal to raise the debt ceiling. house speaker boehner says democrats must agree to a larger approach. good morning, everyone. we will begin with the divide
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between the two sides. what are your thoughts? here are the numbers. we will get your thoughts in just a minute, but here is president obama yesterday in his own words on these debt negotiations. >> the things that i will not consider are a 30-day, 60-day, 90-day, or 180-day temporary stopgap resolution to this problem. this is the united states of america. we do not manage our affairs in increments. host: house speaker boehner held his own news conference yesterday. here is what he had to say in response to the president. >> our disagreement with the president is not about closing
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loopholes. none of us are fond of loopholes. our disagreement is over the idea of raising taxes on the very people that we're asking to create jobs in our country. i would agree with the president that the national debt limit must be raised. i am glad that he made the case for it today. the american people will not accept and the house cannot pass a bill that raises taxes on job creators. host: we want to get your thoughts on this. many deal or grand bargain? here is "the boston globe" this morning. inside the front page of "the washington post" -- excuse me, the front page of "the washington post peer " this is their headline -- "the washington post."
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this is their headline. it says -- host: joining us on the phone is lori montgomery from "the washington post." where are the two sides right
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now? what are the chances of even a short-term deal getting through the house? guest: [laughter] i think that is anybody's guess at this point. it's hard to see how the two sides come together. we're all waiting to see what the contingency plan is that mitch mcconnell suggested that he had up his sleeve on sunday. host: do we have any details on that? guest: not a clue. this is playing out much as they have suggested that it might. the grand bargain is not flying. senate republicans along with democrats, frankly, who have said for several days that we are turning to the biden talks and that's not such an easy solution -- host: are you talking about the mini-deal? guest: no.
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the medium-sized deal, aiming for about $2.5 trillion in cuts. that would get you through the election. biden is enough to solve the problem and avert the crisis through the election. in the biden talks, they had not gotten to $2.5 trillion. cantor is trying to argue that we were really close. democrats and some senate republicans say will only around $1.5 trillion and that is contingent on republicans accepting tax increases. host: what would a mini-deal
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look like? guest: we've heard there are various contingency plans that would focus on the approximately $1.5 trillion to $ trillion range. it's not clear how that would work. i have not heard much talk about a really short term, a 30-day extension or a 60-day extension to give them more time to bargain. host: the two sides meet again today. what are they talking about and who is in the meeting? guest: they're back in the white house. it's the top two leaders of each party of both the house and senate. yesterday, they covered the
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ground of possible agreements in the biden deal. the president has asked them to once again come back with something they can actually passed. i guess we'll have to see what happens. host: lori montgomery with "the washington post," thank you for your time this morning. guest: thank you. host: we will go to a republican in north carolina. what do you think? caller: i have not always voted republican. there are good ideas on both sides. i see that the president is trying to do something. i see that the republican side is kind of holding him hostage. it is really not fair. the problem is very easy. the republicans say that if we do these cuts, we will have a surplus in the future.
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because of that, the government will get bigger. all that needs to happen is to give it back to the people. host: tax cuts later on. guest: exactly. host: what about this issue of a mini-deal versus a grand bargain? do you think they should still e debt ceiling with some sort of short term deal? guest: i agree the raise the debt ceiling -- i agree the debt ceiling should be raised. it will be time for people to kick the can down the road.
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i hate that saying, but it is always out there. the bigger you go, the more people -- the people we put in office have to be aware. this is what can happen. they are forced to make decisions. host: what do you hate about some sort of grand bargain deal? are you willing to sacrifice? i do not like the republicans saying it is a tax increase. it has been said over and over again by the president and other democrats. it's not about increasing taxes for anyone. it's about getting rid of some of the big businesses who do not
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need these extra funds. host: phil in orlando, florida, an independent. what are your thoughts? caller: good morning. we should work on a grand bargain, instead of a mini-deal. to me, it is basic common sense. we need to get people moving in the process. it could be a national bordering program -- national program to do some work that would stimulate your psychological and
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social well-being. secondly, we should be making sure the parties are not playing politics and bowling to their constituents, who basically seem like the corporations that are running the government. host: would you characterize the tea party as a corporate complex? caller: the tea party has merits. we understand their protests. there seems to be sort of an ideology attached to it, as well, which is under the surface of the tea party. host: let's talk to william, a democrat in hollywood, florida. go ahead. ay the: i'm going to s
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grand deal. that's what we need to make. second of all, entitlements, the big three for democrats -- the other two spong of of the other, which is social security -- spawn off of the other, which is social security. those are things that help the poor. because it did not work the way they wanted it to, they let it ballooned to a situation where it has gotten out of hand. host: william, as a democrat, do you think your party can compromise on reforming social security and medicare? caller: like the president said, only if it meant a strengthening social security. first of all, they need to bring back the money that they took out.
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leave that alone. second of all, yes, medicare will have a problem in the future. they have to be very careful about where they slice and dice on medicare. host: you want the savings from cuts to medicare and social security. caller: we want the savings. we want the savings. of course, we want the savings. if you look at it -- it does not take a rocket scientist to see. spending is going up. average worker pay has not even food,d to pay istay level with gas, and other necessities. host: william, this is "the washington post" editorial today. they say --
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host: louisville, ky. jim, republican, go ahead calle. caller: put a constitutional amendment them let the public vote on it to have a balanced budget. second, put central park in new york city up for sale to pay off the national debt. put that on the budget.
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i mean, with the fall election. put it out for the nation to vote on. the third would be -- have congress get straight and balanced with all these illegal s working on construction sites in the united states. host: "the washington post" -- more details for you. host: and then inside "the new york times" this is their story.
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as we go to this next phone call, i want to show you "the new york post" shows you what the president wants and what republicans want. mary, an independent collar, go ahead. caller: i just want to say they should go for the big deal. it's time to make changes. we have to make those changes. the republicans are not being very logical on what they want. we are giving up a lot -- the democrats and independents. in general, americans have given up a lot on this deal the president wants to put through.
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it is time for all of us to give something. host: you are willing to sacrifice on the social security and medicare part? caller: yes, absolutely. sacrificing, making changes, yes, of course. host: a republican in tennessee. caller: good morning. thank you very much for taking my call. host: good morning. caller: this thing about the national debt -- $2 trillion or $4 trillion does not really take care of the national debt. we really need to have something more than that. just the $4 trillion pays the interest on the debt over the next 10 years. you have not really gotten to the point where you have reduced the deficit down to where it is manageable.
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host: in your opinion, even a grand bargain is not good enough. caller: exactly. we have climbed into a hole that will be hard to climb out of fear g. if they do not make changes, this entire country will collapse under financial ruin. host: a little more from the papers. many of the papers have this story this morning. "cantor reemerge as as a key negotiator in the debt talks." a different take on that in "the los angeles times." here is "the richmond times dispatch." here is "politico" this morning
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and they quote some freshmen, saying this. host: also in the newspapers, there's a story about the tea party. here it is in "usa today." "tea party activists will be going after 21 democrats." host: columbus, ohio.
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you are next. democratic caller. caller: i am so offended by the republicans right now. i do not know much to say about them. clearly, i can see eric cantor is playing a game. tea party is going up against our people. this budget thing that they have going on -- i think they need to do something with medicare and medicaid. i think they need to do something with social security. they need to put the money back that they took out. they took all that money out of the fund and used it on something else. those people put that money there. we cannot spend our way out of it. we have not spent it, anyway. host: "the wall street journal" says this.
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host: david is a republican in lewisville, mississippi. you are next. good morning. caller: good morning, c-span. about this politicians, john boehner -- i have supported republicans, but now he wants to -- i mean, the poor people that are on retirement, it's just pitiful that they want to take away from them. i am disabled. we are on a fixed income.
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the cannot go out there and fight for ourselves. we have not had a raise in the last two years. i blame president obama. all he had done was talked about civil rights stuff instead of getting down to it and helping out the poor folks. i live in mississippi. the poor folks are losing this country. we did not make the debt. host: no grand bargain then, in your opinion. caller: no. host: should day raise the debt ceiling -- should they raise the debt ceiling? caller: only if they have to. i've been in that all my life. host: we are going to be talking about the 14th amendment,
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section four of the constitution, later on in our program at about 9:00 a.m. eastern time and whether or not the debt ceiling is unconstitutional. back to "the wall street journal" with this headline. host: also, this article goes through and talks about what the other republican candidates are saying on the debt ceiling debate, if you are interested. here is "the new york times" national section. tim pawlenty going after michele bachmann on one of the sunday
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shows. "iowa, a state where they're hoping he can be the conservative alternative to mitt romney." host: you might have solved a stories yesterday. the new poll from iowa republicans shows bachmann in the lead. "the washington times" this morning.
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also, here is "the washington times." tim, a democrat in idaho. we are talking about a mini deal or a grand bargain. what do you think? caller: we need a grand bargain. we need to stop fooling around and put things in their proper perspective. you know, the legislators over the last four to six decades have had more than enough time to prepare for the baby boomers. i am 62. i'd drew my first social security check in october. all these people are getting money for medicare for free. the president is not as "dumb" as people think he is.
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he's waving the carrot, social security, medicare, and medicaid, and the republicans are buying into it. as for the upper echelon paying more money, yes, they do. they are talking about not raising taxes. i am retired military. they took ouths ago, more money out of my check because they said they changed the pay table for the taxes. host: tim, let me jump in previews started out by saying you are for a grand bargain. caller: yes. host: you went on to say about medicare and social security. can a grand bargain include raising eligibility rates and changing it from 65 to 67? caller: no. we are actively paying for it
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when we raise the age to 65. host: why would you be for a grand bargain then? caller: we have already made our sacrifices. as an elected official -- i have been asking myself this question. would i rather have one person give me $1 million or 1 million people give me $1? i would rather have 1 million people give me $1. the only thing they ask for in return is a good job. the person who gives $1 million is not going to just say, "do a good job and i will be happy." they will be asking for things in return. these are the things that hurt our government. host: we will leave it there. let me show the viewers this tweet. you can tweet us at twitter
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.com/cspanwj. you can also e-mail us. here is an e-mail from diana in new hampshire. park hill, oklahoma. gary, an independent. good morning. caller: good morning. first off, a grand bargain would be great. i would love it. the fact of the matter is we do not have a grand bargain and everybody knows it. that's why the big trade -- that's why the big trade. there's no way we can get the
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grand bargain going. there's not enough time. what we need to do is not raise the debt ceiling. to these people who say they have paid into social security and how they have paid this and they have paid that -- that is not true. my grandmother, who is taking care of five children of a widowed mother -- money was taken out of her check to pay for social security when there was a whole generation of people who would not reach 65 -- they are the ones who sacrificed. host: house budget chairman paul ryan was on one of the morning shows this morning. here is the ap story.
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he made those comments on the cbs "the early show." good morning. caller: good morning. i'm thinking about this and thinking that people have been trying to do their own business. there's a woman who came from africa and people did not know how -- she had to go to cosmetology school to get a license to braid hair. growing up, there were barbershops and all kinds of things. they did not go to school for these things. they were good at it, they were good. it's the same with day care. i offered to do they care for my neighborhood because i work in day care. a lot of them could not afford it. i offered to watch the kids two hours in the morning and two hours and evening. the states that i could not do that. you have to have a license. host: mini deal or grand bargain.
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caller: we did this. we took care of everybody's kids. we trade off. it did not cost. it is ridiculous. host: so a grand bargain? caller: big grand bargain. take everything out. get rid of the income tax, social security, all of it. host: a special election in california for jane harman's old seat. this is what "the new york times" says. that is the story in "the new york times." the front page of "the washington post" in foreign affairs news --
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host: also, and other news overseas, "the wall street journal" has the story related to debt. below that is a story that the u.s. said to sell fighters to iraq. also, some news this morning, as general mike mullen visits with
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his counterpart in china. the headline in "the washington times." then you have this headline on their meeting in the world section of "the washington post." world section of "the washington post" this morning. let's go to wichita, kansas. democratic collar, you are up -- democratic caller, you are up. caller: i happen to be the owner of a small business in which shaw -- in wichita, kansas. i have eight employees two years ago. i'm down to myself and one original employee. i am a job creator. it is baffling to me that when they are saying job creators -- are they not talking about
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corporations? that has knocked -- that has not -- nobody has called and talked to me. i have been calling my representatives. the only thing they want to do is change social issues. host: republicans will say that some of these people we're talking about raising taxes on our small business owners. you would be in the category that makes more than $250,000 per year. caller: i support a family of three and a wife that just graduated with a master's degree in mathematics and she cannot find a job at a school because these people have cut the budgets for higher education. i am supporting the three of us. i think i made negative $2,400 two years ago. this last year, i think i made somewhere around $15,000.
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i am working every day and working on the poverty line. there's a bunch of white people in suits pushing their religion and they are not worried about the rest of the country. host: you are for tax increases? caller: i am for tax increases on their rich. i also think we need to protect our social security. i have been paying on that since i was 14 years old. i pay more than the people work at the aircraft companies who screamed that they need more money all of the time. there's just so many greedy, rich people out there who are not taking care of things the way the rockefellers used to do and the philanthropists that actually built this country. it does not make sense. we do not take care of our people at home. we spend millions of dollars trying to make the rest of the world love us. host: columbus, ohio. good morning. caller: yes, good morning. i have been listening to the comments from the previous
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callers. i believe in eliminating the income tax. i do not believe in a mini deal for a big deal. why isn't anyone paying attention to chaka fattah's plan? host: he is our next guest. we will talk to them about his proposal. what do you like about it? go ahead. onller: i've watched him msnbc. pat buchanan was targeting him asking how much revenue it could generate. he said, based on their tacticians, it could generate up to $9 trillion in the first year to go toward the deficit. i do not know. i'm not an analyst or a rocket scientist. if we are in default right now, he says, in 10 years, it should be paid off, the entire
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deficit, $66 trillion. why is it that the rich and poor are not latching on? when he says eliminate income tax, that should be the deal winner. host: we will talk to the congressmen in about 10 minutes. we want to get you caught up in another headline coming out of afghanistan. the president's brother, half- brother, shot dead by bodyguards. joining us on the phone is hei di with the associated press. what happened? guest: this man was a close associate of the president's brother. he was in ahmad wali karzai's
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house and shot him at least twice before he himself was gunned down. host: was it his own bodyguard? who was this person? caller: we are still gathering details on who this man was. it's clear he was a very close, personal friend. he does handle security for ahmad wali karzai. it sounds like he is a much higher level than your personal bodyguard would be. in theaallowed a gun home, which shows the trust between the two men. brother awas karzai's target? very powerful figure in southern afghanistan and a very controversial one. he's the head of the provincial
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council, which on its own would make him the man controlling the area. both because of his connections to the president and a lot of associations -- he made things happen in kandahar province, which is the real former stronghold of the taliban. he has a lot of enemies, both among the insurgency and also among the various criminal networks that work in that area. he himself has been accused of drug ties, criminal ties, and even of being on the payroll of the cia. all things that ahmad wali karzai denies. he has a very murky reputation. it's hard to know, even though the taliban claims responsibility, what happened and who is behind it. host: how does the u.s. view him?
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guest: the u.s. has most recently seen him as an unsolvable problem. he has been a friend to the u.s. for a long time. because he has been someone who has been hard to bring on board with some of the programs to develop the province, to work with the military -- no one says this directly, granted, because he is a relative of hamid karzai. in private talks, u.s. officials would say they do not know exactly how to handle him. at the same time, he was also someone who was exerting a certain amount of control over the area and able to pass by areas that may not have otherwise been passed by. he has been a complicated friend to the u.s. host: what are the implications of his death for a political solution in afghanistan?
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guest: it is hard to know. he's one of a series of high- level assassinations that have happened over recent months. the question is, if these are all insurgent attacks, does this mean that the insurgency is saying that they are powerful enough to take out these guys and they do not need to talk, or that these are a last-ditch attempts because they do not have the might to come in an more traditional way. it will certainly shake up cantar province in the south for a while. host: what has been the reaction from the afghanistan president himself about his brother? guest: he was actually holding a press conference with sarkozy
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just hours after this killing. the press conference was very brief. he did say that this was a painful moment and a moment that reflected the suffering of all of them. he has been talking about how so many afghans have experienced this type of loss. he says he is working with his international partners to try to bring peace and stability. the question is just whether that is a possibility at this point or not. host: heidi vogt, thank you. a couple more minutes left. we will go to a republican in orlando, florida. mini deal o grand bargain is far -- mini deal or grand bargain is our question. i am a lincoln republican.
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i believe in paying taxes as a duty. you have the medicare and social security idea. it's really an insurance program. nobody is supposed to get what they put in. they're supposed to get more. that's how insurance works. it is just the system. this whole idea about the richest 2% pace 40% of the taxes -- well, if the rich people have a lot of money, of course they will pay more taxes. no one wants to call in and say that most of our wars are fought by the poorest people. no one says that. they are quick to call and make all the comments about taxes. taxes are an american duty. that's what i believe. you go to the five seasons and paid $200 for a steak that you
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can get for $10. the united states may have the highest taxes, but you pay for the surroundings. you pay for the security. all these companies relocating overseas, they do not want to do their duty. i do not see them going to china or india. they are still living here because it's still the best place in the world. host: funeral service will be held for former first lady betty ford today. look for our coverage on c- first lady michelle obama will be attending that funeral. this is in "the new york times" op-ed section today. democratic caller, you are the last on this topic. mini deal or grand bargain? caller: just like we have a new york state lotto, why don't we have a government lotto?
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i know i would buy a ticket. everybody would. the money would be going to social security. that would help out the country. the other thing we do -- our troops. that would also save trillions of dollars. thank you very much. host: coming up in about 45 minutes, we will talk to the chamber of commerce and get their perspective, the business perspective on these debt talks. coming up next, we will talk to congressman chaka fattah about the debt talks. we will be right back.
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>> senators will continue debating the debt and deficit in next week. keep up to date with c-span's congressional chronicle. the daily schedule, committee hearings, and more information about your elected officials at >> now is the time to deal with these issues. if not now, when? >> the debt limit is the legal limit on borrowing by the federal government. since 1962, it has been raised 74 times, the last time in february 2010. learn more and follow the process of raising the debt ceiling on line with the c-span video library. it is washington your way. >> the library of congress
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today features one-of-a-kind presidential papers, photos, music, video, and more. >> this is the largest map collection in the world. >> 62 million items, 14 million pictures. >> we have over 8500 cases. each case has about five d rawers. >> about 65,000 items. we have the thomas jefferson papers. >> c-span takes you behind the scenes at the largest library in the world, the library of congress. a c-span original documentary in high-definition next monday at 8:00 p.m. eastern and pacific. >> "washington journal" continues. host: we are back with congressman chaka fattah, democrat of pennsylvania, second
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district, and member of the appropriations committee. let me begin with a question we asked our viewers. mini deal or grand bargain? guest: we are a great nation and we should not be majoring in the minors. the object here is not a math exercise of how we bet -- we balance the budget. how do we continue to position our country? we are the wealthiest country in the world. we have the most significant military. we have advantages in technology and innovation. how do we keep our advantages as a nation? how do we manage our fiscal house in a way that makes sense? i think the terminology is easy for the washington press, but it does not address the fundamental issue, which is that all of our advantages as a country that used to be absolute are now a relative. we have economic competitors
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that are chasing us. we have china, which is a much larger country. we have india. we have much smaller countries that are really threatening our lead in a number of scientific areas. singapore has invested in their science. they are attracting some of the best dancer scientists -- among the best cancer scientists in the united states. the question is what we want to be over the next 100 years? if we want this to be another american century, if we want to be exceptional, we have to step up to the plate. host: does that mean you would agree to reforming social security, medicare, and medicaid? if so, what would you agree to? guest: we cannot be a great nation if we do not have entitlement programs like social security and medicare.
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we have had to tweek them from time to time. we have had to stop and pause for a minute to get our fiscal house in order. they have done these deals before. they have almost always been half-spending cuts and half- social security raises. there have been tweaks. we now limit the amount of money that people pay because of social security taxes or medicare taxes. we can lift that. we could restart it at a higher income, you know, $500,000 or above. there are tweaks. we could give medicare to negotiate pharmaceutical purchases, the way we do with the v.a.
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brains are better when they work like parachutes, when they are open and everything is at the table. host: here is "the washington post" editorial over the weekend. do you agree with that sentiment? is nancy pelosi the leader -- is nancy pelosi, the leader of the democratic party, wrong? guest: i do not know if she said she does not want to cut them. there's a difference between cutting benefits and taking measures that would improve the program. if you took medicaid and you were able to make group purchases of pharmaceutical drugs, you could cut costs by huge percentages. it does not affect the beneficiary at all. the question becomes, how do you organize these programs? how do they function?
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no, you do not want to take someone who is in the shadows of the economy, making a paltry sum of money to begin with, and take further from them. that's not the goal. the goal of the president, i think, to say, "let's put these things on the table" is how to insure we have a social security program in the future? that's the same thing ronald reagan did. there were little tweaks to the program. because this affects millions of people, small, minor changes have a major impact in terms of the number of dollars. host: should the savings be directed toward bringing down the deficit, or put back into the programs, as nancy pelosi has said? guest: i totally agree with nancy pelosi in this regard and the president has said the same.
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there's nothing about the operation of these programs that are contributing in terms of the deficit or the debt. host: how do you reduce the deficit in the short term, if you do not put the savings for that? guest: they are talking about having a deal in which to deal with a multiplicity of problems at once. you have the debt and deficit and problem -- debt and deficit problem and the entitlement reform party. even though they are operating together, they are separate and stand-alone resolutions to these problems. . host: phone calls for you. laura, you are up first. good morning. caller: good morning. with all due respect, do you understand that $800 billion of our tax dollars are given to china on interest on the debt that we have?
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that's over $2,000 for every man, woman, and child in this country because you people are not balancing our budget. we, in our households, have to do that. you know what? if you say that a balanced budget amendment is not mandated or important, then you are so out of touch with what they tea party -- what the tea party and people in this country understand in their daily lives. guest: she must be reading from a script. i did not say anything about the balanced budget. i totally agree we should get out of debt. the notion that we have moved from being the largest creditor nation to the largest debtor nation -- we should all be embarrassed by that. where this came from, the bush tax cuts or the two wars.
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we just need to put this in some perspective. we cannot go back to whose fault it is. we do need to understand how we got here. us talk about how we go forward. i have the only bill in the united states congress to get the country completely out of that. hr-1125 says let's have a consumption tax. let's get out of the income tax business. it has done about all it can do for the country as a revenue raiser. we have a consumption-based economy. we have a circumstance in which we are not generating the revenues that we need in order to meet our bills and our obligations. there's no reason for us to have our hand out, running around the world seeking investors in
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treasury notes. we should afford to pay our own bills. we should pay our own bills. we cannot have it both ways. the cannot complain about china having a space program, but we do not want to pay any taxes in order for us to have a space program. we cannot have this notion that we are going to have the best military in the world and do it on the cheap. it's going to cost money and we will have to pay for it one way or another. i prefer to pay to have the protection now than to have to pay for not having the protection later. host: we are putting up the details of your legislation. essentially, 1% tax on all retail and consumer transactions. president obama was asked about it yesterday during his news conference. he responded by saying, "let me answer the question broglie." have you spoken to the president or anybody at the white house on getting the vote on this?
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guest: i have spoken to an everyone. i think the fact that all of our economic impediments -- the europeans use a v.a.t. host: is yours a value added tax? guest: no. it is an american version. a value added tax is focused on the added value at each point in the production line. my proposal has little to do with the production line. only has to do with the transaction itself. we are saying, let's have a nominal fee on transactions in which the federal government plays an important role because of our regulatory or judicial process thees. we have $900 trillion in
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transactions in our economy each year. there's plenty of money moving around. there's no reason for us to have a $1 trillion deficit. there's no reason to have a $14 trillion debt. these transactions would not take place absent for the federal government, absent for regulating the banking system, ensuring these deposits, having a court system to handle complex -- handle conflicts. all of this can take place. i think we should move to a consumption tax vehicle as a country. i think we will. may not be today. maybe five years from now or it may take longer. china, the europeans, all of these other countries are using consumption taxes. our economy is 75% consumption, except we are not focusing on that as a revenue generation process. mired down in the
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income tax process. trying to deal with the tax code, 70 two thousand pages. the republicans trying to simplify the debt has done nothing but make it more complicated. they would rather move any of these proposals. i think it's high time that the democratic party step forward and agree that we need to simplify the code. in fact, i'm saying let's get out of that. that have a tax structure has an economic growth for our country. growing a pie is much easier to deal with. host: congressman chaka fattah is our guest. here is a tweet.
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derek, democrat in columbus, ohio, you are next. good morning. caller: good morning. i do not know if you want to call it a grand bargain, but it should be fair. i wholly disagree with your tax idea. i think it would be unfair for citizens to pay different rates. if you make more, you should pay more it should be about what is fair in this country. if you make more, you should pay more. there is absolutely nothing wrong with that. this government that was set up to take the -- take care of a least of us as well as the best of us. social security in medicare is now really the cause of the deficit. it is ultimately fair that the united states has always been
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borrowing money and there is been very few times that we have had a balanced budget. guest: i respect the fact that he may disagree but he may not fully appreciate what i am suggesting. i am suggesting a transaction fee in which the reality would be we would exempt families of $250,000 m below. we would examine transactions between personal accounts. his view that this would somehow skew against parts of our country in which incomes are substantially lower than the warren buffetts or the bill gates of the world, if he would look to the details, he may have a different opinion. we will not have unanimity in every decision. i am one member of congress and i have offered a proposals. how come they're not other proposals to get the country out of that?
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look at the rye and planned. it does not get us out debt until 2015. we need to have a real debate. i have an idea. let's see other ideas about how we can actually act as adults. pay our bills, meet our responsibilities, prepare future generations for the opportunities to live in the greatest country in the world. we have a federal highway system that we could not build today with this notion that we're not willing to be taxed for anything. we would not have the infrastructure we have now hit past generations were selfish in the sense that they were saying, i want to pay as little as humanly possible to build this country. host: there is a tweet from the jim hines.
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guest: i think that happen that way. if we do not have this lack -- this matter settled within the next few days, i think the senators in a bipartisan vote will pass a package. i think the president will address the nation and the house will be left to its own devices to eventually pass it. maybe it will be before the stock market crashes or after, but they will eventually pass it. host: a short-term deal. guest: no, i am talking about a clean debt ceiling raised. if the republicans are on willing onunwill -- unwilling, i think there are enough votes in the senate to get a clean debt ceiling bode. the president will address this nation and say how important this is. the house into
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session. i think we will eventually get their brief the notion that this a leveraged only exist on the republican side, that the president is over a barrel, i do not buy it at all. i think that the republicans want a smaller government allied, $4 a trillion in smaller government outlays is on the table. they should do a balanced deal and move forward. host: you ever heard that in the senate there are 60 votes? guest: it is always the u.s. senate that stands up -- and i hate to say this because i am in the house -- they did it in health care. they passed the bill that became the basis of the final resolution of the affordable care act. because the house sometimes is not capable of dealing with the
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more controversial issues, because a lot of us are elected in districts in which it is a lot easier to focus on where our basic believes than the focus on the broader national picture. host: an independent in houston, texas. caller: me in my husband will not be able to have social security when we get up to the cage where -- we're both 46 years old. we are doing our own retirement plan. and that is what some of you people up there do not understand. we have parents or their social security has been cut and their medicare has been cut. this is a farce. no one at our age will be able to get social security. and you take it out of art checks every month. and the medicare.
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you want to sit there and talk about this. you need to practice what you preach and don't get your paychecks. host: congressman? guest: i cannot deal with speculation. i can only deal with the facts. social security words. $500 million comes into the pennsylvania post office in my district. every month. i think we have a responsibility to continue the program. this republican -- is almost libertarian -- social security is not going to be there. so far, so good to read it word for my grandmother and my mom now collects it. i am going to collected. host: and 2036, there looks like there is a shortfall. guest: i hope that the phillies and the eagles win in 2036. it is a long way away.
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in terms of social security, we want to make sure that as previous congresses have done, that we adjust our modify the program in ways to make sure that you can meet its obligations. what are its obligations? before social security, we had seniors in our country who had nothing to eat. poverty among seniors was the largest percentage among any population in the country. since we created social security but-said it was created, i did not created -- we eliminated the idea that we would have people eating pet food as a way to meet their nutritional needs. it is of basic minimal safety net. it was never the notion that social security would be your only retirement three idea is that you would have social security as a base. you have a private pension and an individual saving. so that you could have that
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trifurcated set of devices to help you at a time when you're in come from your work life would cease. we have a social security system that works. we should be much more concerned about the viability of the private pension funds. we need to do more oversight to make sure that private pension funds are as stable as we want them to be. host: the tweet. guest: we are going to have an election in 2012. i think that the presidential support among democrats are at an all-time high. i think that his support among independents is part of what is helping initiate these discussions geofacts -- go forward.
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i think it is a lot less important rather than winning the economic war against -- what is the wrong word -- economic competition among our major competitors. it is much more important of question than two or which party. it is a small fry discussion when the real issues our world leadership in play. we need americans to stand up of both parties and of no party is and to push our country forward. host: mike in florida, a republican. caller: i want to say something first. i am not a member of the tea party. i have not contributed to anyone in the tea party. i have not gone to a single tea party meeting. please do not use the demeaning
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"you are reading from the script" point that you use for previous callers. devereaux wasserman schultz said that you own this economy. it is not george w. bush's fault. your idea of taxing everyone another 1% for breeding, it is not going to cut it. i do not care what china or europe does. i do not want to be like china or europe. i want to be like america. if we give you guys one more dime, it will go to the deficit. you will find a way to spend it. you never cut the budget. that is why we need a balanced budget amendment said that we can hold your feet to the fire. guest: i am sorry if you thought i was been demeaning. she said that i had said something about the balanced budget amendment which i had not. since she was making things up, i said that she was reading from the script.
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it is early in the morning and i think that what we need to be doing is thinking about our country this early in the morning. we have a lot of opportunities. we just need to think about how we're going to go forward. you say the economy belongs to the democrats. let me tell you about our economy. we have 130 million people going to work today. we have 3 million job openings and we have on employment of about 9.2%. in some places in this country like north dakota, their jobs are doing one thing and there are other parts of the country where we have unemployment higher than the national average. there is a variation depending on where you are in the nation. our jobs are critically important and i am focused on increasing manufacturing toward florida, we have a space program that is critically important.
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i know that you have a particular point of view and you are entitled to it. i am saying, let's find some people who are interested in the future of this country and have a common sense, rational discussion about what we need to do. let's see about doing it. and that is my view of the world. i think that we're going to get there from where we are. i guarantee that we will take some responsible votes after all the talk is over with and deal with the debt limit. host: you mention nasa feared that is the topic this morning before the house science committee. it will review the space launch system. live coverage at 10:00 a.m. on mike, a democratic collar. caller: got less c-span.
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the republicans want to lose that last election and they are doing everything to make everything worse and worse. all they have to do is show for 16 months. am i off? host: we are listening. caller: all you can hear is through the phone. all of them money people is just want to chill for 16 months and all we care about is the unemployment rate. if that does happen, the thing that they are going to do, big business does not want regulation or taxes. if they do not do anything, they have no interest in creating jobs. if the republicans had polled this economy back, that would be crawling and breaking their arms over each other. it is not just the economy. they have tried to get him to
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claim the economy after three months which is just ridiculous. host: let's hear from rick, a republican and tampa, florida. caller: i could not disagree more with the last caller. obama and the democrats could have made any changes they wanted to make. i am for a flat sales tax which will allow everyone to pay equally. given those incentives to hire more people, that is how corporations would get their tax breaks. guest: we need to have a group of ideas before the congress. we need to do our tax system, figure out how to get the revenue that we need is a country. we are not going to be graded -- it is a fact of life that weather is airports or trains, i
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was talking to the head of the federal transit administration in pennsylvania guest today. our trains are 40 years old. we have bridges that are in really bad say. this is not in my district, but in the suburban ring around the city. but this is all over the country. i want to say something about jobs. i think that we should focus a lot more on enhancing and improving manufacturing in the country. i have been visiting manufacturers both in my district and around the country. i was looking at united technologies out in connecticut making airline engines. they have a young woman there who is an engineer, not out for 20's, helping to put together a new approach to a jet engines that cuts the noise by 70% and increases fuel utilization. they have orders from all over the world.
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tens -- thousands of people working. we need to think about how to improve things. they had been making engines in its plants since 1940, but they have a new approach. they have a new product. and advanced technological approach. this young woman, she was probably not even encouraged to go to engineering school when they started making engines in that plant. we have done it in the past and i believe that we can continue to do it. this nonsense of back-and-forth democrat, republicans, i think it is small potatoes. i would encourage that we have all of these great minds the watch c-span. think for a minute about the country and not so much about party identification. host: back to your proposal, eliminating personal income tax, eliminating refundable and
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nonrefundable personal tax credits and the amt. it would be a 1% tax on all retail and consumer transaction. this tweet asks -- guest: my proposal would exempt transactions in the financial market -- until such time as there was an international agreement to tax other financial markets around the world. host: why example wall street? guest: the deep-20 is in the process of developing a transactional tax. -- g-20 is in the process of developing and transaction attacks. you cannot tax the stock market here until there is an international framework to do so. that is the only reason why i exempted them. but my concept is to get rid of
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all of the income tax, the capital gains, to get out of the internal business of americans of how they generate the income. and focus more on what they do with their income. when they come out on the economic highway, and they make transactions in the best economy in the world, because it is transparent and protected to our judicial process, their money isn't -- insured by the federal deposit, that they pay a small transaction of the, take whatever term you like to take. i think it is the way to go. i hope that some point, if it is not a better idea, that someone comes up with a better one. host: we're talking with congressman chaka fattah of pennsylvania. you gave as an indication that what will likely happen is that
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the senate as a clean bill to raise the debt ceiling, no provisions, the president comes out and puts pressure on the house to do the same, leading up to this august 2 deadline. would you vote for some sort of clean bill? guest: yes. what i think will happen is what the designers of the government intended. at the end of the day, you have senators with six-year terms, they are able to take a broader view. they are able to not be so mired down in the broiling sentiment of the moment. they can look at the national need of the country that may be above and beyond the partisanship of the moment. you have the president offer up everything on the table to negotiate with the republicans in the house. what you heard from the republicans is that they cannot move. whatever their reasons, they cannot move on revenue.
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we're not going to keep going over this clip. we will not see how bad things really are. i do not believe that is an intelligent way for the country to go forward. host: you think that house speaker john boehner is sincere when he says that any tax increase can i get to the house. guest: then you see what the problem is. you cannot see because of the divided nature of the government, you cannot move forward. rather than making any improvement, we're going to tread water with some kind of clean bill that gets us into an election in which the electorate can help make a decision. host: to you think it hurts both parties by raising the debt ceiling without solving the long-term deficits last debt problem? guest: i do not think it hurts
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the party is because we have done that plenty of times. if we do not do something about the deficit or the national debt, we will pay $one trillion in interest. that is almost the entire bill does i do not want to be overly alarming -- but the entire discretionary appropriations budget of our government. that would just be interest on the debt. host: we were just showing the u.s. debt clock showing the numbers clicking along in real time. shreveport, louisiana. caller: i am disturbed and disappointed how what is always the republican party continuing to try to blame everything on president obama. the fact of the matter is, they are not going to work with this
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president. no matter what is proposed, they were a jet to it. he is trying to be fair -- they will object to it. he is trying to be fair and work with both sides. this is not going to work. we all know that it is not so security, medicare, or medicaid. the-social security, medicare, or medicaid that is the problem. john boehner is refusing high tax rates for anyone in the upper echelon, $1 million, whatever, they are not to be tax. if everyone is going to pay their fair share, it seems like the republican party ought to be willing to work with president obama. i am disappointed in the president because he is compromising too much. it did not work under the bush eight years, giving tax breaks to the wealthy americans, and i
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do not believe that it is going to work now. i appreciate your speaker very much for what he is saying. host: how closely are you following the debt negotiations? the president met over the weekend with both parties and he will meet around 3:45 p.m. this afternoon. caller: i am following so closely and that is why i am disappointed in our president as well. he is willing to compromise with the republican party instead of telling them that it does not point happen and it is not going to work. host: is this president compromising too much? guest: in a negotiation, if you have to figure out what the and purposes. if the purpose is to observe and protect the greatest country in the world -- to preserve and protect the greatest country in
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the world from harm, then you have to go as far as you possibly can do to get a deal. if the purpose is to score points against the republicans, then maybe he is compromising too much. it depends on what he is trying to do. what i think the president is trying to do is to say, look, we have not seen a great depression. one out of four americans did not have a job. right now, one out of 11 do not have a job. this could get a lot worse if we're not careful. if we're going to pay $1 trillion on the national debt by 2020, if we go close to the fall, that interest will jump up. those numbers will change overnight about what we have to pay out in terms of interest on debt for this country. i think the president is trying to go the extra mile because of how vitally important this is. not because he is disinterested and -- just interest and
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compromising with republicans and looking like he is compromising too much for the base of his support. he is trying to do what is right. i think speaker boehner is trying to do what is right. i think they could come some -- come to some agreement about how to move forward. but he has a group of people that had been elected, they pledged that they would never raise taxes. they do not care whether we have troops massed on the border from some foreign country tried to overtake us, they do not care what happens. they do not want to raise any more money to position and america for a great future. they want to cut spending. that is what they have been elected to do. they had a slogan that says, and grow. maybe they work somewhere, i do not know. somehow what we invest less and do less, we're going to do more. that notion, i do not agree with that.
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host: i think it is cap and balance. guest: now they have a new one. host: 1 tea party group saying they are going after moderate conservative democrats in swing districts and republicans who raise the debt increase without including -- if it includes a tax increase as well and if it does not include a balanced budget amendment. guest: i voted for a balanced budget under clinton. they came to a deal and i voted for. we had 25 million new jobs. we balance the budget and paid off hundreds of billions of dollars in debt. it did include more revenue on the top 2%. it did invoice more in education and technology. -- invest more in education and technology. we had the best economy that we
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have ever had. it is probably better to look good recipes in which it ended up being served -- look at the bush program over eight years. we ended up with an economy that tank. why would we want to continue to do that when we could follow a path to prosperity. i think that was the title of the paul ryan budget proposal. host: a tweet. guest: the first thing is that the fairtax is a proposal by republican. they are in the majority. if they wanted to move it, they could move it. i am in the minority. if i had the opportunity to get a vote in the house, of love for the speaker to have a vote on any number of these proposals. i think that i would win and a loved have a debate on it. the first is a proposal to tax only the final retail sale of an
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item. they say that at 23%, it would get out of the income tax business. economists have a different view and say it would be higher than that. i'm going to understated. mired proposal is not to be concerned about the purpose of the transaction. all other transactions, nominal fee. a lot of money merger room. host: 01% tax along the chain. guest: any transaction in which the federal government plays a significant role. you exempt transactions into in between personal accounts. host: peter, a republican, you are our last caller for the congressman. caller: it has not been proven
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to be constitutional. it was plagued with misinformation, and it was used in a way where bribery had to take its place to get it passed. after the information was given to us about how much it was going to cost, they discovered that it was far higher. host: we're running out of time and we want the congressman to respond to you. the health care bill. guest: the cbo says that it will shave a trillion dollars of our deficit in the long term very much more important, it offers the promise of affordable health care for over 30 million americans. i think that it is an important accomplishment. the gentleman says it has not been proven to be constitutional. there is only one appellate court has ruled on it and that court ruled 10 days ago.
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they rolled in a bipartisan way, both republican and democrat judges on this panel, that it is constitutional. it will not be the only but it is the first ruling on the appellate courts. in the lower courts, the majority ruling is that it has no meaning. there been rulings that it is and is not. when we get a contrary appellate ruling, that is when we will see the supreme court stepped in. and the real question will be this -- does the federal government have the right to say that you need to have health insurance? host: health care law likely brought up before the house committee today. kathleen sebelius will be testifying today. for more affirmation, go to c- in 45 minutes, we will talk about the 14th amendment section
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that deals with the debt and whether or not the debt ceiling is unconstitutional. what is your take? guest: the public debt should not be questioned. pensions and so forth. it sounds like they were talking about social security. they had an amazing vision for our country. but i think that we should not rest on some constitutional interpretation. we should use common sense and get to common ground or higher ground. host: could the president use that to raise the debt ceiling? guest: no, but i am not opposed to using it as leverage to get a deal. host: that will be our topic in 45 minutes. next, we talked to bill miller of the u.s. chamber of commerce about the business perspective. a news update from c-span radio. >> more on the debt talks from paul ryan, the chairman of the
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house budget committee. he says his republican party is vehemently opposed to tax increases because u.s. businesses have been put at a disadvantage with their foreign competitors. speaking today on cbs, the wisconsin republican says there should be over $1 in spending cuts for every dollar in new borrowing authority. he went on to say that he believes the debt crisis is coming and is hitting not just our country but countries around the world. we want to get ahead of it. meanwhile on wall street, stock futures falling for the third straight day as investors weighed the prospect that italy, europe's third largest economy, could be the next country unable to meet its debt obligations. dowser down 17. grid u.s. house is in session with new energy on the schedule requiring more energy efficient light bulbs. critics of the new bulbs said that the cost him much. supporters said that the money
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is made up for as soon as you turn on the switch. either way, some republicans say it is an example of big brother government going to far. watch live house coverage at 10:00 a.m. eastern on c-span television. those of the latest headlines on c-span radio. >> american history on c-span3 highlights the 150th anniversary on the civil war. the attack on fort sumter, and in two weeks, the first major battle of the civil war, the battle of bull run, with 48 hours of civil war programming. continue work your own exploration of civil war history online at the civil war trust, the preservation of our battlefields, the civil war, every weekend on american history tv on c-span3. >> c-span has launched a new website for the 2012 presidential race.
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biographical information, twitter feed, and facebook updates from candidates and political reporters. links to media partners in the early primary and caucus states. visit us at /campaign2012. it and the supreme court is now available as a standard and enhanced the-book. it tells the story of the court to the eyes of the justices themselves. the 11 original interviews. this new edition includes an interview with the new supreme court justice, elena kagan. with the enhanced e-book, at your expense by watching multimedia clips from all of the justices. available now whatever e-books are sold. >> "washington journal" continues. host: bill miller is our guest, senior vice president for the u.s. chamber of commerce, here to talk about the stalled gatt talks. the president meets with the two sides today.
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i want to get your reaction to what the president had to say yesterday before he headed in to the debt talks that day. >> i have bent over backwards to work with the republicans, to try to come up with that formulation that doesn't require them to vote sometime in the next month to increase taxes. what i have said is, to identify revenue package that makes sense, that is commensurate with the sacrifices we are asking other people to make, and that i am happy to work with you to figure of how else we might do it. host: bill miller, do you think the president has done enough to put a deal on the table? should republicans except what he has put out there? guest: from the u.s. chamber's perspective, we definitely believe that the debt ceiling needs to be raised. we cannot go into a situation
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where the full faith and credit of the united states is putting into jeopardy. what the deal is at the end of the day, the trajectory of spending, what the revenues like, we want to judge it when we see it. it is premature to speculate on what the deal looks like. host: the president said yesterday that any tax increase, bringing in new revenue, would not happen until 2013. is that agreeable? guest: we are not seen all the elements of the deal. again, from our perspective, the most important thing is that the u.s. not default on its debt. we of seen with other countries what that means. we certainly have not seen this in this country. we hope and our strong belief is that it would have detrimental impact of businesses across the country, and really every american with regard to higher interest rates. and short term, real impact on
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the stock market. host: what about allowing that bush tax cuts to expire for wealthier americans? back when this was first talked about, it was endorsed by alan greenspan. we have a big surplus and it was time to do something with it. an economist at the university of california --
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mr. greenspan says that we should now let all the bush tax cuts expired. guest: certainly the chairman has the right to his opinion. there are those that believe in 2001 for those that believe in the 1990's that the internet was going to be something that was a bubble that whenever burst. you are always going to see economic cycles that move up and moved down. the question of tax cuts or raising taxes at a point in time when we are in an economic angst is probably not the right recipe at this point. host: the present as said that this would be in 2013. guest: we do not know what the economy will look like in 2013, either. host: tax increases should be off the table. guest: there is an important grand bargain to be had. from the chambers perspective,
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we should look critically at what is in the best interest of america. if tax increases remain in a meaningful, significant way they do not harm the economy are on the table, we shall look at them. host: what are some examples. guest: i do not want to get into a place where i am speculating. host: people are interested in what the chamber believes is palo alto business. -- palatable to business. guest: it is difficult to speculate about what the things as you as an industry are willing to give up unless you know what the other side on the spending side are willing to embrace. from our spec -- a perspective, there may be things important to give up. i do not think that negotiating the public is right. host: which you put in the navy column tax breaks for oil and gas companies?
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-- maybe column, tax breaks for oil and gas companies? guest: we should look at all those things in the context of a grand bargain. host: an article. it could throw millions of more americans out of work and create another recession. do you agree with the "new york times guest:: i did. not moving forward on a debt ceiling increase is dire. we have not seen it in the u.s., we have seen it in other countries, and it is not a pretty picture. it would include a steep drop in the stock market. we are at historic low interest rates. if we look at these negotiations
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moving forward, one of the things where the budget is so low in terms of interest on the national debt, if these interest rates were to spike, that proportion of the national debt is either larger in terms of what the budget looks like. host: during our news update, we heard that the markets are reacting to what is happening over in europe. this is the financial times this morning. in both italy and spain, the market reactions to that. when you see investors start to react to the debt talks here if no deal is reached and they get closer and closer to august 2? guest: it is unclear because we have not been through this. but i applaud both sides of the republican leadership in the house and senate leadership, as well as the white house, to understand that this is something that needs to be
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negotiated earlier rather than later. as most things that happen in washington, it takes until the last moment to actually get a deal, whether we had that on the budget or the continuing resolution end funding. the one thing important is that the markets believe that there will be a deal. today to have seen mostly markets that have reacted with some interest but not a great deal of interest. there is a long lead time between now and august 2. i was going to say, but at the markets -- if we started to move the -- into the last week in july and there's still this back and forth and posturing between leaders of on capitol hill, and the white house, i think you'll see a very different dynamic. not that dissimilar to what we saw in the fall of 2008, when the tarp vote failed.
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and the markets went down almost 700 points. host: the most in one day. we just heard from the congressman, our previous guest, his prediction on how it plays out. they get closer and closer. the senate votes for a clean debt ceiling increase, nothing attached. the president addresses the country and put pressure on house republicans to do the same. what do you think? guest: what they are talking about right now is very ambitious. i applaud it. host: the grand bargain. guest: i applaud that they can talk about some issues that could change spending trajectories in america and that would include sacred cows on the right and on the left. i understand the politics of the further left and the further right complicate these things for the leaders. the president and the speaker, to move forward on these things.
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but i think it is important for it to i think that at the end of the day that that will be the deal when we're talking about $4 trillion and tax increases that would not take place until 2013? i do not know -- i think that may be a bridge too far. but it is an important discussion and i applaud the president for talking about putting things on the table like so security and medicare. i do not think that any republican could do that and not be completely savaged. host: are you getting assurances from house leaders that there is a contingency scenario that includes just a clean vote to raise the debt ceiling? guest: no, but we're not in the room at the lighthouse or in the capital. that being said, we continue to voice our support for the one most important thing, and that is we cannot default on our obligations. that is the biggest and most important message that we
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continue to push across the street at the white house and up on capitol hill. host: you said you agreed with that editorial this morning. the rhetoric from michele bachmann saying that the government in go ahead and not raise the debt ceiling as nonsense. do you agree with that part of it? guest: i do not necessarily agree with everything that the "new york times" says on a general basis. but what i will say is that assertion by some that this is unimportant moment is very uneducated. host: does that include freshman republicans? have you had meetings with them? guest: we are have -- we're telling them the same. i am making here today. i understand the politics of this. but there is an element of responsibility very important. that area of responsibility is to ensure that first and foremost, the united states
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government does not default on its obligations. host: a democrat and omaha, nebraska has been waiting. caller: i just want to ask the question. after the republicans gut medicare and medicaid and social security, what you think is going to happen to the world when the poor do not have anything? where are they supposed to go for any kind of medical assistance or anything? i do not understand -- why would you put the poor people, jeopardize their lives for expensive taxes that the world knows he cannot afford any more? guest: thank you for the call. my response to that is, in terms of the changes that are proposed and have been proposed with regards to social security and medicare moving forward, all
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of the proposals that were talked about and discussed in the budget included only individuals who were 55 and under. i think that the most irresponsible thing that we could do in the congress and that the congress could do is to allow programs that are unsustainable, i.e., there are too many people who are looking at medicare and social security and who believe that it will never be there for anyone who is paying into the system who is a younger person. while these programs were designed with different longevity in mind, we need to make some minor adjustments to them to sustain them and make sure that seniors today get every benefit that they have been promised, but as we look to this sustaining of the program,
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that it is there for everyone who is paying into the system today. host: as we talk on this tuesday morning and debt talks continue, they are stalled right now, but president obama will meet with leaders later and will meet every day. here is a store that is breaking about the nation's trade deficit on the wire this morning. it is said that the trade deficit surged -- we will go to virginia, an independent caller. caller: my question is, if they cut medicare and social security, is going to fall back on us states. they will have to pick that back up again and that as a tax increase. republicans are saying no tax increase. which is it? host: why do you think it is a
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tax increase? caller: there will have to feed the poor and they will end up with more from the states. host: the states will have to tax more. mr. miller. guest: i would say this. all of the proposals put on the table that have not yet been acted upon, and i think that is important, goes around the idea of sustaining these programs going forward and making sure that everyone who is due their benefits today who is a senior, over 55 years old, would receive all of their benefits. i know that there is a lot of political rhetoric around this. i know this tends to be an easy talking point, an easy point to demagogue, but the reality is no one is talking about taking away benefits of people that our senior citizens receiving them now. host: here is a tweet.
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guest: taxes are an element. what we saw it as we did a jobs summit yesterday that ran the gamut from having a chat in malta, but co-chairman of the president's job counts -- jeff immelt, the co-chairman of the president's job council, in our roundtable of 1400 businesses around the country. taxes are important. the price of gas is an important element. these are all the things that are important to small businesses. taxes are lower today but people are not investing. why is that? small businesses are the most optimistic people in america. this is the embodiment of the american dream. leading a safe job and starting your own business, making a go
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of it? that is what the american dream is all about. whether taxes are lower not, at the end of the day, the business and individual has to believe that there is a future for them. it was regardless of what the tax rates are. i think tax rates are a portrait is important to keep tax rates low if we're going to grow the economy and create a degree of certainty said these guys can move forward. host: i job discussion yesterday. afl-cio had their own and then taking a look at jobs. good to our coverage mich., a democratic caller. guest: highlight to know how this man got his job. whether he retired urge just appointed. host: you work for the chamber of commerce. what is your background? guest: i work for the u.s. chamber of commerce for 11
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years. prior to that, house chief of staff to a member of the house of representatives for five years. in addition, i am a small- business owner myself. i own three restaurants in washington, d.c. unfortunately one had a fire a few weeks ago. i do not just preach the stuff, i lifted. i have been a serial of entrepreneur my whole life. u.s. chamber of commerce is private. we're funded by our members. we have 2600 state and local chambers that are our members. about 900 associations. many of the businesses in america from the fortune 1000 to the mom and pop's across the country. host: their portfolio includes election-related activities. i want to get your take on 2012. here is "usa today." they are going after democrats and republicans that vote to
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raise the debt ceiling including tax increases and does not have a balanced budget amendment. will the chamber be looking at republicans who do not vote to raise the debt ceiling? trying to educate members about how important is vote is. the chamber is not a one trick pony. we looked at members on their votes on taxes, on health care, on trade, on labor-related issues. but this is a really important vote. what it really speaks to is the over-politicization of the pledge mentality. there are too many litmus test on both sides come on the republican and democrat sides, dot to particular -- of fealty to particular things, the tax
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pledge. we perps and -- we represent businesses of all types. host: will you give money from your organization to republicans who did not vote to raise the debt ceiling? guest: it is too early to say and we are not in an election cycle. host: tom donohue, the president of the chamber, said that the chamber would get rid of freshmen who refuse to vote for raising the debt ceiling. guest: he did. this is an important vote. this is an extremely important vote. the u.s. economy cannot bear the failure to make good on its debt and obligations. what we are doing is making the case that this is a moment of responsibility. and while both parties are to blame and both parties share
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responsibility in the economy getting to where it is and the budget and the government side is getting to where it is today, there are important points that require responsibility. this is one of them. host: gregory, a democrat in manhattan. caller: the morning greta and tear gas. hopefully i can finish my point. when brad asked you a question, it was a direct question regarding president obama's take on the negotiations. you stated the issue without answering her direct question. bisected thing is, you agree that the date ceiling should be raised, right? guest: yes. caller: yet you come off adding it raised on the backs of the people. anyone with any common sense should want to be included in the sacrifice. that includes business owners,
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small business owners, it includes unemployed people, it includes working people. to sit there with the facade that you are about republicans and democrats in you're going to say, both parties are to blame, the reality is no -- we know why we are in this that we're in. $3 trillion from the chinese to pay for work, it was a republican president because this problem. guest: i appreciate that call. as i said before, i respect and appreciate what the president brought to the table in the discussion over the weekend. i respect and appreciate what the leader brought to the table and the speaker. and i think we're still in negotiation phase. at the end of the day, there is plenty of blame to push around in terms of how america got to
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this point, where number one, we need to raise the debt ceiling, and number two, they're people that have been talking for years and years and years about the importance of changing the trajectory of entitlements, the sacred cows that no one seems to be able to ever get their arms around. they are increasing the size of the federal budget. these are not the discretionary elements of the budget that people say, if we only cut waste, fraud, and abuse, we will be in a great place. the parts of the budget that are increasing are not that. they are the size of the dead and they are the size of the entitlement programs. until we are able to get hold of those things and address them, we really are taking around on small edges of the budget. host: we go next herald, a republican and illinois.
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caller: this is harold hunter and i wanted to give another approach because my question is, within the debt and deficits and the health care with social security, medicare, and medicaid, they are talking $4 trillions in cuts. they are proposing to dollars trillion. i believe we're going to have to, and i wanted to know if you agreed, we're going to have to raise taxes, especially on the millionaires and those they can afford. our grandparents had elderly and disabled such as i am, and i'm a 55-year-old disabled person with life-threatening diseases, we will lose at needed health care and doctor care. my question to you this, sir and
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waym, is there any other that you can believe that we can sustain the budget without raising taxes? guest: thank you for the call. i think that for many years we have been kicking the can down the road. what i have been impressed with is the willingness of both republicans and democrats to put things on the table that they have not been willing to do in the past. we can argue about what those things are, and again, i would say that in terms of the benefits for medicare, medicaid, social security, for those 55 and older, no one has talked about changing those benefits. it is always, what is the number people paying into the system now, far away from retirement, what is the benefit package look
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like that is sustainable? in terms of the budget, it is important that many of the issues that we talked about today remain on the table. the chamber, we're not point to speculate on deals until we actually see what a deal looks like. there is a degree of shared sacrifice that is and one for all americans if we actually change the trajectory of what the american budget looks like. host: host: here is "the new york post" on what the republicans and democrats want.
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we go to marry next in dayton, ohio. caller: listen. i apologize because i am an angry person. i am a divorced mother with a single income. why we are here today is not because of people like us who could not make it i decent wage. the thing with corporate responsibility, this comes down to the person making minimum wage. we all have a responsibility to our country to pay our taxes. i believe that this debt
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ceiling, what ever, the government knows what to do. mitch mcconnell, eric kantor, understand and we all have a place here in america. do the right thing. do what we're paying you for. host: linda, a republican in missouri. caller: first-time caller. i do not like the increase. if we give the government more in tax money, we will just spend more. i would like to see an alternative minimum tax on corporations so a company like g.e. that paid absolutely nothing with at least to get hit with 15%. that puts them at a non- competitive edge against everyone else, so i would like to see an alternative tax corporations. host: what about that issue? guest: it has been talked about in the past. companies have years where they
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pay a lot in taxes and years were they have a lot of deductions. that is the case with general electric. the united states, honestly, these discussions most of this year, and last, have been about how the u.s. has the highest corporate tax rate of any country in the oecd. if you take a look at what are the underlying issues about deductions and things and if you're able to put them on the table and lower the overall corporate tax, this may be something that would be of benefit to the vast majority of companies and state. host: off of twitter -- guest: revenues are low because economic activity is low. this is the paradox. this is the paradox that faces american companies of all sizes
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right now. the level one certainty that exists for these companies is whether it is the large companies who have over $1 trillion sitting on the sidelines that are waiting to be invested in the economy but not being invested, not because of the tax rates but more because of the uncertainty that exists across the board. for these companies, we need to create confidence in the u.s. economy. more economic activity creates more opportunity for tax revenue that helps the local level, state level, and federal level. host: democratic caller from wisconsin. caller: good morning. thank you, mr. miller, for taking my call. in half an hour i will be going to vote in the primary. our state of wisconsin has had a
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lot of change happening in the last -- since the last election of gov. walker. my concern is not only will i have to go and sign my name at the polling place. the next time when we vote, i will have to show my identification to vote. the same-day registration, i think that will go by the wayside. my concern is across the nation, a lot of governors in different states are starting to enact this law. i think wisconsin, being one of the states that have taken away the bargaining rights of public employees has been used as a role model. i am very concerned about this. i think the people have not been able to have a voice in what is happening in this is being
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signed into law by republicans and i am seeing our nation going the same way with no one taking the time to sit down and really negotiate something. i look at both sides in the senate and house, and i just get the feeling that there should be term limits and we should get them out of there. i do not see "business as usual" being good for our country. host: we will leave it there. we go to boston on the independent line. caller: i want to talk about the issue of raising taxes and everything. people are very upset, as you have been talking about about whether or not we should raise taxes. really, it is an irrelevant question. we are already being taxed through inflation. when the federal reserve decides to print a lot of money to
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stimulate the economy, it obviously drives up supply. host: i think we got your point. guest: my response is that does bring up the issue, again, of where we would be if the debt ceiling is not raised. almost everyone that has experienced this in other countries have seen inflation increase, and we are really in one of the bright spots of this economy which has been the continued low inflation. if we were to move it to a place where there is, number one, a question that the financial markets have about whether or not the united states is going to default on its obligations or that we actually do that, those historically low interest rates are going to change.
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i think that is something that all of us should be worried about. in the past year or so, for me as a restaurant owner, when energy prices go up, when gas prices go up, there is a surcharge on every bill that we get from people delivering fish and produce. when commodity prices increase, the price of wheat means the price of bread goes up. the price of corn means the price of meat goes up. we see commodity inflation existing in various forms now, but overall inflation has been remarkably low. i think that is really important to continue to keep that, because it does change it every american's ability to put food on the table, drive their car, be able to pay their mortgage or rent. that inflation, it has been remarkably low, and it is important, i think, as we try to
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figure out how we move past this economic malaise to really move forward. keeping inflation in check has been something the federal reserve has done a good job with. host: 50 debt ceiling is not raised, and the bond holders will say they want a higher interest rate, correct? guest: the u.s. will become riskier credit holdings. host: who are the u.s. bond holders? guest: pimco, china, other sovereign wealth funds, other big institutional investors that purchased u.s. debt. host: wht about 401k, 403b, pension funds? guest: they are all tied in to the treasury bonds. if you're going to create a higher degree of risk for what
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has been basically set for all time of every economists that have said, what is the one absolute that you know? you absolutely no that u.s. treasuries are zero risk. if the u.s. treasury becomes something other than zero risk, everything else that will have a cascading effect. host: water people buying when they purchase treasury bonds? what is the investment? guest: in essence, a 30-year note or shorter. these are the investments that you make as you look at your 401k, as most financial investors would sit, if you are younger, take more risk in the stock market and maybe make your portfolio look like, maybe 80% in equities and stocks, maybe 20% in bonds and more secure
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investments. as you get older and, you want to create a higher degree of safer investments which include much more of the bonds, whether they be u.s. treasuries, state or local bonds. what we have seen in the past, at the local level, some of the bond ratings for the local bonds have increased in terms of their volatility or their risk. we have never seen a situation where the u.s. treasuries have ever been anything other than absolute safety. say: on august 3rd, let's that we pay the bondholders but we continue to not make other payments, we do not make social security payments. what impact will that have on the economy where people do not get a social security check therefore they do not go out and buy the things, the consumer price index, those sort of things? what happens to the economy?
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guest: there are those who have a floated the idea of prioritizing debt over obligations. i think this is a dangerous place for the u.s. to move into. whether or not the united states is going to put a priority on debt service vs. the american people is something that we have never done before. in our opinion, that is a bad risk. think about all of the people that are contracting with the government, the people that are providing services to the armed services and the military who are fighting in afghanistan, iraq, and other places. contractors that are providing, whether it be tanks, uniforms, or people providing the services for the v.a. health clinics. you're going to make a priority to say that we're going to pay debt service to china, but we're not going to pay the people that
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are supplying our military or providing for health care. host: i know there is a political calculation, but economically, is one worse than the other? guest: i think they are all bad. once we move into the prioritization perspective, someone sitting at home may save that is exactly what they do. they only have so much money and will only pay certain things. it is an unfortunate reality that a lot of americans are facing right now. what is the most important thing for us to pay for? i think that is why the discussions of creating a deal are in evidence today that there is a possibility to bring in these other things because we do not want to get to that point. there are a lot of political realities of capitol hill, particularly in the house regarding this debt limit. for them, it is a "what did we
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get in return for taking a vote that is very unpalatable?" they may have a primary to the right of them if it would take that vote, so what is on the other side of it? hopefully what is on the other side of this for them is that we change the trajectory. host: republican from fort worth, texas, you are wrong with bill miller from the u.s. chamber of commerce. -- you are on with bill miller. caller: i think a lot of this really relates back to health care costs and a lot of the health-care cost problems are related to this bubble of americans called the baby boomers. i, personally, would be able to take care of my parents if they did not have the means, but a lot of us are not having kids now like they were.
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we keep talking about the cuts to funding and benefits for people under 55. has anyone even contemplated cutting funding and benefits for people over 55 in this bubble and keeping them for people under 55 because i do not think we will have some of these problems in the future that we're having right now. of course, if we do not take care of the problems now, we will have them later. host: we will leave it there to get your final thoughts. guest: thank you. your point is a good one. it really talks about maybe the most important element of this debate which is that when these programs were built. it was a bargain that the government made with individuals. you pay and to assist them and you get out of it. at that point in time, the average life expectancy may have
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been in the low 60's. now it is 80 years old. the government is on the coke for obligation that it simply cannot pay or sustained. the other element of this is demographics, as you accurately point out. the baby boom is just on the front edge of this. the question is how we look at sustaining this going forward. any actuarial is going to say that this is unsustainable today. we have to look at two things. what are the political realities? what can actually be done? then what we have to do to sustain a program that has been a great benefit to a great many americans and is part of the u.s. compact, the government's compact with people who work hard, pay into social security, and it spent them -- and expect them when they get older. and they should. what are we going to do to ensure that it is there for the
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people who are retiring today are soon going to retire and those who have paid into the system now that have this huge boulder recipients. you do not have enough people paying into the system to sustain it through the entire baby boom. host: mr. miller, thank you for talking to our viewers. people refer to the 14th amendment, section four, that perhaps the president can ignore the statute because this is what the constitution says -- is the topic coming up next. first, a news update. >> 17 past the hour. pakistan intelligence officials say 38 alleged militants have been killed by three suspected u.s. missiles in northwestern pakistan. this is in less than 12 hours. the attacks come two days after the obama administration
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suspended more than one-third of u.s. military aid to pakistan, about $800 million. the attacks indicate the white house has no intention of stopping the drone program. syria is accusing the u.s. a provocation after secretary of state hillary clinton said the president had lost legitimacy and was "not indispensable." this is one day after hamas attacked embassies. violent uprisings have been happening over the last four months as rebels tried to oust president assaad and and his family's 40-year rule. in the states, the gao says the government is making it more difficult to detect medicare fraud. in a report to be released today, they say the government systems for analyzing medicare and medicaid data are "inaccurate and underused."
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fraudulent claims are between $60 billion and $90 billion per year. we will hear more about that at 10:00 a.m. eastern on c-span radio or live on c-span3. those are the latest headlines on c-span radio. >> now available, c-span's congressional directory. a complete guide to the 112th congress. and side, new and returning members with contact intermission including twitter addresses, district maps, and committee assignments. information on the white house, supreme court justices, and governors. order online at you are watching c-span bringing you politics and public affairs. every morning, "washington journal" about the news of the day connecting with elected officials, policy makers, and journalists. weekdays, live coverage of the u.s. house and every weekend
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supreme court oral arguments. you can see her signature interview programs. on saturday's "the communicators." on sunday, "newsmakers," "q&a," and "prime minister's questions." c-span, washington your way. a public service created by america's cable companies. host: we will back with michael abramowicz here to talk about the 14th amendment section for the constitution. we showed it to you. professor, how did this provision end up in the constitution? what does it mean? guest: it came about during the
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civil war. they were borrowing by both sides, the north and south, to finance the war. the winners of the war, the union, wanted to ensure that their debts would be paid off. in the confederate debt would not be paid off. initially, they put in a separate sentence from section four to indicate that the confederate debt would be repudiated. there was some concern that when the southern states would return to the union that they may try to repudiate the union debt as a political tactic. they wanted to make sure that did not happen. section four invalidates the confederate debt and insured that the union debt continued to be valid. it is also written a note like the rest of the 14th amendment, in general terms. it can apply about debts
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incurred before the civil war. but it refers to pensions. guest: one question people have is what exactly does public that mean? when we think about what a public debt means, we think about bonds issued by the government. certainly, it is somewhat controversial that it is included within the public debt. one of the hard questions about the clause is what exactly also is included in the public debt. the fact that pensions are specifically mentioned in regards to the war itself, it suggests that at least government pensions but also be included in the public debt. some have argued that maybe social security is included. i think that is a bit of a stretch. social security is not quite the same as a pension. it is not guaranteed in the same way. the government has no obligation to pay social security. host: the debt ceiling is a
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statute written in law. what part of the constitution makes the debt ceiling unconstitutional? what is the reading? guest: the argument, which is certainly controversial and hard to interpret, but the argument that it is unconstitutional is that if we hit the debt ceiling, as it seems that we might come and simply stop paying our bills, and among the bills that we fail to pay will be bills on the public debt, payments, for example, on bonds that the u.s. is obliged to pay. the argument that this is unconstitutional that this is a statute that will lead to a default, a failure to pay debt. that counts as a question of the dead. that is the word that the 14th amendment uses. host: if you agree with that, and you say that there are advocates to say that the
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president should be threatening this and he should ignore the debt ceiling statute and go ahead and pay our bills. where is the logical stopping point? guest: that is certainly an argument used by those who argue that the public debt clause does not give the president a basis for ignoring the debt ceiling. their conclusion is what is unconstitutional is the fault. there are a lot of factors contributing, not just the debt ceiling. there is the tax level, revenues. they argue that if we really believe that the president can ignore the debt ceiling to make payments on the debt, maybe he can do more dramatic things. maybe he can just increase taxes. because we cannot default on the debt that he will announce an increase of taxes without legislative approval. host: as the supreme court ever weighed in on this part of the constitution? guest: there is one case from
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the early to mid 20th century. the supreme court did knowledge the existence of a clause. some people have made too much of it on both sides. in the end, they found a way not to award damages. the most critical section seemed to a knowledge, of the very least, that this is a clause that had continuing relevance beyond the civil war and was not simply limited to debt that existed prior to the passage of the 14th amendment. host: congressman scott from south carolina says it would be an impeachable act for the president to find a way around congressional authority to raise the debt ceiling. guest: i think people who are concerned that the president may make this move and are concerned that may give the president more leverage in these discussions want to raise the stakes so the president does not do this. one can argue on what an impeachable offenses, high
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crime, or misdemeanor. even if one agrees if what the president is doing is unconstitutional. it would be unusual to say that an interpretation of a law by the president would be an impeachable offense. that is whatever the congress says it is. host: the congressman referred to the part of the constitution that says only congress has the power to borrow money and the credit of the united states. guest: absolutely which forms a strong part of the argument for those who claim that the president cannot ignore the debt ceiling. ordinarily, we need to have legislation for the president to issue debt. those young the other side say there is one line out there that is creating a problem now. if we conclude that one line, that one statute will lead to an unconstitutional currents, we can say that is unconstitutional and still have the authority on all of the other statutes to
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have the issuance of debt, therefore the argument is he would be acting with congressional authority, simply ignoring the one line that would most immediately lead to defaults. host: michael abramowicz is it our guest and we are talking about the 14th amendment, section four. here is the subject. if you want to call in, the numbers are on your screen. or we will take your phone calls about the 14th amendment and whether or not the debt ceiling is unconstitutional.
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a republican in dallas, texas. go ahead. caller: i think it is constitutional, but i have been trying to get through to you guys for two or three days about being overextended. host: what is your question? caller: i have a statement and then a question, also. on the debt, i think there's a lot of things that can be done. i am 73 years old, but i think we should put social security, medicare, raising taxes, all of it should be on the table. it should be talked about. for instance, i think we should look back really history. if we look back to when carter was president, they raised the taxes on the top 2% of income earners and our economy was better then than it ever was. host: we will leave it there.
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he said the debt ceiling is unconstitutional. guest: used the word "unsustainable." even apart from the debt ceiling, but our financial situation can lead to the accumulation of debt. i think that is one of the perils of the debt clause of the 14th amendment. arguably, in not only renders the debt ceiling unconstitutional, but it also renders our entire earth is a situation in constitutional in the sense that, hypothetically, congress are not to pass any more laws that eventually medicare, for example, would explode that we would not have the money to pay for it in the very, very long term. we would default on the debt. it is an interesting double- edged sword. on the one hand, it says the failure to pay now would be unconstitutional, and on the other hand it says maybe we are
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already in an unconstitutional situation or in danger. host: the debt limit is the legal limit on borrowing by the federal government and includes social security come medicare benefits, military salaries, etc. the debt limit has been raised. how many times since 1960? 78 times a permanent hourly raise, extend come or revise. 49 times under gop presidents, 29 times under democratic presidents. "i, new york, democratic column. go ahead -- mount sinai, n.y.. caller: this is tough for me to ask, because i am not educated to your degree, but the constitution seems to be manipulated by the multimillionaire's running the government and it has been shifting. it seems to me president obama, the first thing he did when he came into office was grant immunity to the telephone
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industry for spying on american. that seems to me like a violation of the constitution and i wondered what your thoughts on that was. up is down, down is up. you have a society where young children cannot get jobs. newly graduated college graduates cannot get jobs, yet you want the senior citizens to work until they die so you do not have to pay them off on the ponzi scheme called social security. guest: 1. but the constitution is that there are debates among democrats, republicans, people of different assault -- the loss is about how we interpret the constitution. we have seen a lot of debates about whether the president is properly interpreting laws, properly interpreting the constitution. whatever one's view in general about the constitution and whether many provisions can be read clearly, i think that this is one that is, at least,
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somewhat difficult to interpret. i read a paper on this about 15 years ago, and i struggled a lot trying to figure of these questions. i think there is room for, certainly, reasonable debate about this provision. we have seen reasonable debate by people on both sides that have taken the other position. one democrat is saying the president should not use this as a basis for ignoring the debt ceiling, and there are those on the other side as well. host: the white house has said that using the 14th amendment is off the table, but they have been encouraged by members of congress and other progressives to come at least, threaten the use of the 14th amendment. guest: and other things are allegedly off of the table as well like short-term deals but if we get within a few short hours, everything will be back on the table. host: farmington, maine, republican line. caller: i am an example.
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i am 62 years old. -- i am 67 years old and i retired at 62. i have collected more social security payments that i ever paid in. it is a pyramid scheme for the ones on the top. i could also say that i am lazy american. i worked as little as possible, never made more than $20,000 annually. but i grow my own acute -- food, garden, hunt, own my house, but i was lazy. no one should pay for me. i have already cost more than i paid in. payback all the money that people have put in. pay them the money back with
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compound interest and get rid of social security. it is just stupid. host: carl, a democrat in chicago. go ahead. caller: i would like to ask your guest a question. would you agree that the debt ceiling, this is that that we already have. it is nothing new, but just the current debt for things that we have already spent money on. host: hold on. let me have him answer that. guest: if we take out more debt to make payments on existing debt, then we have to make payments on that debt, too. caller: my question is this. the constitution has laid out responsibilities for all three branches of government. if one of those branches does not fulfill their obligation under the constitution, does
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that open the door for one of the other branches to step in and fill that void? guest: there is a lot of controversy about this, as well. one question it leads to is whether the judiciary has a potential role in this. i think the general view is if president obama were to conclude that the debt ceiling is unconstitutional or unconstitutional as it is applied in the particular case of right after when a payment is necessary that the court would probably not reviewed that. they could review it later if people who have positions in credit default swaps filed a lawsuit, but possibly not. some people who hold that now could bring a lawsuit trying to get some kind of declaratory or injunctive relief on the court tried to get the court rather than president obama to decide
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that this is unconstitutional. it will be interesting to see if any lawsuits are filed over the next month. host: republican line from michigan. welcome to the conversation. caller: the debt ceiling is merely like my credit card. you raise the level of spending and give me the right to spend more money. to pay our bills, all we need to do, really, is stop the spending we're predicting we will spend, like on welfare, medicaid, and government pensions and government salaries. they are all people that we, the taxpayers, are keeping in existence. host: michael abramowicz? guest: part of the political dynamic is, i think, but the besides want to avoid a default because it would become at the
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very least, expensive in that we would have larger interest rates. there is some asymmetry in how much each side cares. one small government republican, many tend to believe that we take the position that we will just live within that that there will be some combination of spending increases, if you want to make the decision on a year- over-year basis that people tend to prefer spending cuts to tax increases. i think one part of the asymmetry in leverage that we have in this negotiation is that some republicans think it is bad, but not quite as bad as some democrats think it will be. i think everybody agrees it will be bad, but that is one reason that we see the president willing to offset a relatively large number of spending cuts relative to tax increases.
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host: off of twitter -- guest: going back in time, do you think it is a good idea to have a provision in the constitution that we will not default? the answer for that is probably yes. when people think we will not default, we get better interest rates. one concern about the position that those who say that the debt ceiling is binding take is that people who think section four is not a big deal. they see section four as irrelevant. we no longer have the sense of that constitutional restriction on the fall that exists. that, combined with our commitment to not the fault followers our borrowing cost. host: is there a legal
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precedent? guest: >> not of the 14th amendment. that is why, i think, there's a historical precedent. there are many who think we need to pay attention to the debt ceiling and it has been raised 78 times and there has never really been this discussion whether or not they think it is constitutional. they have assumed since we have had it for so long that it must be constitutional. it has been there the whole time, but it has never gotten to the point where it really mattered. host: here is a headline of yesterday. it meant there was a technical default on some of the investors. what happened then? guest: there were lawsuits. there is no doubt that there will be lawsuits there is a
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delay in payment by bondholders. there's very little doubt they will receive everything back but interest. host: the law is on their side. guest: yes. unless they've claim sovereign immunity, these lawsuits would be brought and once the money exist to pay them back, they will get their money back. with interest. that is what happened in 1979. how does that affect future interest rates? one art -- one academic paper argues there will be a permanent adverse affect from then on simply because the sense of the treasury bond as being a perfectly safe investment would be eradicated. that is the concern here. people think of it as pretty darn safe. maybe even that just a tiny bit of risk may mean higher interest rates.
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realistically, bondholders will be paid back eventually, even if we had a two or three month standoff. host: arizona, independent line. caller: my question is similar to previous callers, that the constitution set it up so that congress has the authority to make debt going forward for bonding. the debt that we are discussing where we possibly be in default is that that has already occurred. could a major argument by obama, if he needed to come out to say that this country will never default on its debt, so that is why he could use the 14th amendment to his advantage to
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leverage so that this country never does the fault. it should never come to that point in this country. i was wondering what he would have to say about that. guest: at the very least, politically, there is some attraction that whatever happens we will never default. one thing that is important to see about this debate is that the president could take at least three different positions. one, he could say is that we will ignore section four of the 14th amendment. another would be the same will act like we never had this crisis in the first place and business as usual. that is an intermediate position in which she says we think the debt ceiling is binding except for the extent that it would lead to a default on past debt and except for the need to issue existing debt to pay off past debts. that is, perhaps, an attractive position, both legally and
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politically, that would still leave the crisis. if we stop making social security requirements, there would be a big crisis. at least, in that case, it would not actually lead to a default. it could adversely affect our future ability to borrow. host: republican line from pennsylvania. good morning. caller: good morning. my question is how much are we paying for people who did not really pay in to social security and did not work like these kids who are hooked on drugs, alcohol, stuff like that and are collecting s.f.i. how much money? host: i think that is out of the area of the expertise of our
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guest. to ocean city, new jersey. you are on the air. caller: hello. good morning, america. i kind of do not agree with the republican agenda. i just wanted to make that statement. i really feel like they want to take away benefits to people on social security, yet they give subsidies to billionaire oil companies. to me, that does not make any sense. social security is, sort of, an asset. as far as the constitution, one crazy question. we are talking about impeachment of the president. is there any way that the general public can remove members of congress from their seats in sort of a public impeachment of people who do not do their jobs and lollygag? guest: you cannot recall your
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congressman except for every two years in the house and every four years for the senate. a lot of callers are bringing a general position on their views of social security. for example, medicare, defense, and so on. that is one of the things that makes this so hard. this is a game of chicken. everybody knows that a kind of has to get done and we come to the table. here is a game of chicken where everything is on the table. every issue, every debate, every grievance that both parties have have to get worked out. we have to be able to kick the can a little bit which brings everything back in from medicare, social security, defense spending, corporate tax cuts, and so on. that is one reason this is so hard and why, in the end, it will be resolved very shortly before the deadline. it would be smart of the parties not to do it earlier if there is enough time for everyone to
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think and argue, parties will back off. it has to be done at 10:00 p.m., have a vote yes or no, no time for public debate. host: the more time there is, the more they hate it. guest: we have one whole week before the congressional vote and everyone has time to think about it. during that week, both sides are going to try to get more out of it. they are right to say, "this is what i did not get," and the deal will fall apart. of the deal needs to get on at the deadline. congress will have to stay a little late, and they will vote right there and quickly so that we do not have enough time for whatever coalition emerges. host: off of twitter -- guest: those appointed by a
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republican 10 to interpret specific provisions of the 14th amendment. host: what do they say? guest: there is the protection clause, due process, protection of the community, and treatises have been written about all of them. there are too many issues to talk about. one question is to what extent to those interpretive and philosophies spill over into section four? some say we should read it literally, some say we shall look at the text of the constitution. scalia would probably say that. that is a little hard. host: maryland, robert on the independent line. caller: you can cut me off, but give me a minute to make a statement or two. and seven times during the last political administration the
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republicans passed this debt ceiling. seven times. nothing was said about it. they took the money and they rerouted all of these taxpayers money straight to the credit people who control all the money. they sit on it and they are hoarding it. host: let's ask our guests when it was raised in the past committed to constitutional part of this ever come up? did people reference the 14th amendment then? guest: not really. there has been very little discussion on the debt ceiling. now a lot of people are finding out. up from my perspective, it is nice that you people are reading my article, but it has never come up very much. they can find it on
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and type in my last name under the list of my publications. it has not come up a lot. when we raised the debt ceiling, how much did we raise it? when do we want this issue did come back again? we have not heard talked about bring much cheer, but you could imagine part of the issue would be to repeal the debt ceiling altogether. assuming some kind of deal, but they will have to decide when they want to next have this same game of chicken where we can argue about our future. host: here are the leading holders of u.s. securities. china, $1.15 trillion. japan, $906 billion. the u.k., $333 billion. oil exporters, $200 billion. brazil, $207 billion.
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the caribbean banking centers, russia, hong kong, and switzerland. fort worth, texas, on the republican line. caller: i was wondering why we just cannot raise the debt ceiling and not pay everybody their taxes for like the next five years. do not do any refunds. how does the constitution handle that as far as tax refunds? does it say that they have to give us refunds? guest: if, hypothetically, we did not raise the debt ceiling and come to a resolution, would you still get refunds on taxes that we have paid? a lot of these legal issues about what happened exactly as we had these limits have yet to be resolved. there are a lot of the obscure treasury regulations looking anthology's technical questions about what exactly will happen. if we have some kind of crisis,
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everyone will want this to end. the islamic previous government shutdowns look like nothing. it will get resolved one way or another. it and what happens that we, that future to our borrowing costs. host: next caller. caller: thank you. we have a radical group of republicans that have been working for years and years in the congress to deliberately do, what they call, to get rid of the social safety net programs that they have attacked openly. they have deliberately put us in debt with tax breaks, the wars in iraq and afghanistan. they have borrowed all of the money. grover norquist toll call them -- told all of them to not raise taxes under any reason,
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host: independent from utah. caller: thank you, c-span. our founding fathers would turn over in their graves if they found out how much money we are putting our children in the dead. but they never wanted the constitution to deal with that. guest: our current levels of debt are sustainable. they are high levels of debt, but as a percentage of gdp, it is a lot lower than greece. it is a lot lower than italy. within the last couple of days, we realize they have serious problems. i do not know if the free market and a particular vision of how high are debt would be relative to gdp. they are huge, relative to the wealth we have it. economies expand over time. we have recessions, we have lifts, and we have declines. over the long term, economies grow.
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our economy will be much larger 30 years from now than it is today. that does not mean we want fiscal problems or we will be able to balance the books, but i think the notion that the standard of living will be lower 30 years from now than today is completely inconsistent with several hundred years of economic history. host: republican from crescent city, fla. caller: one thing about the debt ceiling, whether it is constitutional or not, i can see the last few years were no budget has been passed by congress and spending, as far as i am concerned, has gotten out of hand. this is almost a break where people have to sit back in congress and think about what they're doing. i hope this is never done away with, although i think it could be lowered instead of raised. one other point i would like to make is as government rose and
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private employers shrink, the employers that are paying all of the salaries in addition to their retirement funds and their health benefits, at what point does this become unsustainable? is this not also a large part of our debt? thank you for taking my call it. guest: at what point will reach the point of no return where we will actually default? not very long time and i think we will come back before that. at what point are we on this go trajectories so that if we did not change something it would lead to as the inability? we are there already, and particularly with medicare. health care inflation is so high, higher than the increase in gdp, medicare is progress in taking up a higher percentage of the budget. the question, for both parties,
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is how will we control the future growth of medicare so it does not get to the point where 50% of the economy, literally, is devoted to medicare spending? host: 5 minutes left with michael abramowicz and our topic is the 14th amendment, section four. here is what the constitution says. we started the conversation for talking about how this got into the constitution. could you quickly go through that? guest: we had a very costly civil war, costly in lives and dollars. the union wanted to ensure that their debts would be honored and the confederate debt would be repudiated. if you look at the toltecs, the text you read was edited out -- people text says the union debt
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is honored and the language they use, which is part of the problem we have today, is it is not the clearest language you could imagine. the validity of that is not in question. there is all lot of legitimate debate on that issue. host: satellite beach, fla., on the independent line. caller: he answered one of my questions that the debt ceiling may not violate the 14th amendment because it does was reached, the 14th amendment would compel the bond holding would be paid first and geithner or obama would have to pick and choose. i want to ask what secretary geithner has been doing now when he started messing with public employee pensions. i could not find a specific article that addresses that. he said he suspended investments, but those articles mentioned in the past that he suspended payments. i did not note there to be a
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case for public employees to bring a case saying that geithner can amass a public employee pensions because with that not be considered public debt? guest: a very good question. it is clear that some pensions are included within the public debt. i suppose one might argue, although this has not been a part of the conversation, that some of these recent actions, could you argue? perhaps you could make the argument that some of those actions, to question the validity of those pensions. i think it is a stretch, probably, because i think geithner is looking to for statutory and regulatory a 32 verify what he is doing. we have not seen a failure to make payments on the pensions, but there could be an argument there. host: democratic line from gettysburg, pennsylvania. caller: i find the discussion intellectually dishonest. the debt ceiling will be raised because wall street and the
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special-interest groups, as they relate to the corporations, and all the other special interests are going to demand that it be raised. i question about the preamble to the constitution. to ensure domestic tranquillity and promote the general welfare? i will listen offline. guest: could one argue, as some have argued in the past, that it does not have an effect on constitutional jurisprudence. could the preamble affect how we affect other interpretations? i do think you are right about special interests. partly because of the people who are funding their campaigns, both sides will ultimately want a deal done. but i think it gives the republicans a little more leverage is public opinion.
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we hear people on the democratic and republican lines here, people on the republican line say to lower the debt ceiling. the democratic line says we should not explore it at all. there is a game of chicken. whoever is more committed to doing the things that no one wants to happen, that party will get a greater percentage of the pie in the negotiations. host: 1 minute left with michael abramowicz. republican, go ahead. caller: i am calling about the 14th amendment and the debt ceiling. i am a retired civil service. i retired military. i am a disabled veteran. with this budget deal going on


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